Soaring demand make Cape Town and Durban investable logistics and industrial markets
Image: Supplied
Cape Town and Durban have emerged as two of Africa's most investable logistics and industrial markets due to their resilience, adaptability and strong investor appeal, according to Cushman & Wakefield | BROLL.
Cape Town continues to outperform, with rising rents and declining vacancies underpinned by a period of semigration, operational stability and constrained industrial land.
'Demand is being driven by a flight to quality, semigration from other provinces and growing e-commerce,' said Shane Howe, the head of Western Cape Industrial Broking at Cushman & Wakefield | BROLL.
Strong governance and functioning infrastructure position the city as a low-risk node compared to Gauteng.
'The Cape market is supported by limited stock availability and escalating demand, especially for modern industrial parks,' said Howe. Development hotspots such as Brackengate and Richmond Park are expanding, while gentrification in older nodes like Epping and Parow unlock additional opportunity.
'Against this backdrop, investors and occupiers must thoroughly align busines
Video Player is loading.
Play Video
Play
Unmute
Current Time
0:00
/
Duration
-:-
Loaded :
0%
Stream Type LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text Color White Black Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Transparent Semi-Transparent Opaque
Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps
Reset
restore all settings to the default values Done
Close Modal Dialog
End of dialog window.
Advertisement
Video Player is loading.
Play Video
Play
Unmute
Current Time
0:00
/
Duration
-:-
Loaded :
0%
Stream Type LIVE
Seek to live, currently behind live
LIVE
Remaining Time
-
0:00
This is a modal window.
Beginning of dialog window. Escape will cancel and close the window.
Text Color White Black Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan
Transparency Transparent Semi-Transparent Opaque
Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps
Reset
restore all settings to the default values Done
Close Modal Dialog
End of dialog window.
Next
Stay
Close ✕
s strategy with location and asset selection to ensure long-term sustainability,' he said.
In Durban, chronic land shortages and rising operational costs have created a landlord-favoured market.
Anthon van Weers, Full Status Property Practitioner at Cushman & Wakefield | BROLL, said, 'There has been no meaningful release of flat, flood-free land in over a decade. Most viable land is tied up in Tongaat Hulett's portfolio and development remains stalled by topography and financial constraints."
Vacancy rates are at historic lows.
'Units, especially mini-units and large distribution centres (DCs) are snapped up almost immediately,' said Van Weers. Triple net rentals for A-grade DCs currently range between R105/m²–R110/m² with further rental escalation likely if supply remains constrained. However, high municipal rates double that of Cape Town or Johannesburg deter some tenants.
Still, Durban remains attractive to owners. 'Despite high costs, Durban is a low-risk investment market because of stable demand and long-term leases from logistics operators near the port. Proximity to port infrastructure offers a decisive cost advantage,' said Van Weers.
Cushman & Wakefield's global data shows a 43% surge in logistics investment over the past decade, driven by urbanisation, e-commerce and supply chain reconfiguration. Globally, more than half of logistics markets are projected to experience rental growth through 2027, driven by strong occupier demand.
South Africa is on the same path but with an added urgency due to land scarcity around key Cape Town nodes and the Durban port. Rental growth is accelerating in both cities, particularly in high-demand, low-supply zones, signalling a unique opportunity for climate-conscious and future-proof investment.
According to Cushman & Wakefield's Climate Risk report, climate-resilient assets are now achieving stronger lease uptake and longer tenures, with facilities in lower-risk zones commanding higher rentals and lower incentives. Yet, many markets have ignored climate risk, leaving assets exposed and underscoring the need for smarter development.
In addition, climate risk is now central to asset valuation and investment due diligence. From capital expenditure planning to leaseability and compliance, assets that embed mitigation strategies early attract stronger investor interest and pricing premiums.
This is mirrored locally, with tenants, especially multinationals factoring in resilience, water security and energy independence when selecting sites. South Africa's Western Cape corridors and select Durban nodes are emerging as premium options, according to Cushman & Wakefield | BROLL.
Global trends point to e-commerce, 3PLs (third-party logistics) and last-mile delivery as major sector drivers. E-commerce alone has surged 289% globally in the past decade and is now the leading demand driver in the Americas and EMEA regions (Europe, the Middle East, and Africa).
Locally, the Western Cape's infrastructure, lifestyle appeal and political stability are reinforcing this trend. In Durban, mini-units and small-format warehouses measuring 100sqm to 500sqm are in high demand as small businesses shift from traditional retail to fulfilment-based industrial space.
'Some retailers are closing stores and shifting to warehouse models to meet online demand,' said Van Weers. 'Decentralised nodes like Cato Ridge, Shongweni and Tongaat, however, have struggled to gain traction due to high logistics costs.'
BUSINESS REPORT
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
IOL News
14 hours ago
- IOL News
Vows, views … and venue red flags: what every couple should know
Don't let the beauty of your wedding venue blind you to the warning signs. Image: Pexels. As you embark on the exciting journey of planning your wedding, choosing the perfect venue is a crucial step. It's easy to be whisked away by stunning settings, twinkling lights and picturesque views, but before you get swept away and sign a contract, it's important to keep your eyes peeled for potential red flags. Claudia Postigo, a seasoned wedding planner and founder of The Planner Co., shares her five red flags to watch out for when picking your wedding venue. Hidden fees lurking in the fine print That enticing "all-inclusive" deal might have some sneaky surprises. Many venues hide additional costs in the small print, think service charges, cleaning fees and overtime penalties. Postigo's advice: "Always ask for a complete breakdown of every possible fee before signing anything." Strict vendor restrictions limit your options Some venues have exclusive partnerships with certain caterers, florists or photographers. This can restrict your choices and inflate your costs. Postigo's advice: 'If a venue says you can only use their preferred vendors, that's a major red flag. You should be free to choose professionals who align with your vision and budget. Restrictive venues often have deals with these vendors that benefit them more than you." Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ Make sure the venue has contingency plans if the weather turns bad. Don't take 'we'll figure it out' for an answer. Image: Pexels. Vague or non-existent weather backup plans If your heart is set on an outdoor ceremony, make sure the venue has contingency plans for bad weather. Postigo's advice: "Don't take 'we'll figure it out' for an answer. A reliable venue should have clear backup options, from sheltered areas to heating arrangements." High staff turnover or unclear staffing plans Take note of who you meet during your venue visits. If you're greeted by different coordinators each time, it might be a sign of instability. Postigo's advice: "Consistent communication with the same coordinator is key for a smooth wedding day. High turnover suggests your wedding details could get lost, and inexperienced staff may struggle to handle issues as they arise."
IOL News
18 hours ago
- IOL News
Cape Town City running out of road in bid to reverse relegation after Gallants ruling
Running out of options? Cape Town City chairman John Comitis has hinted that they may have to buy another club's status in order to stay in the Betway Premiership. Photo: BackpagePix Image: BackpagePix Cape Town City must now accept they'll be playing in the Motsepe Foundation Championship next season, having run out of options. Ever since they were relegated from the Betway Premiership, the Western Cape club have been exploring possible avenues of remaining in the league. On Thursday, they watched as their best chance went up in smoke. The club had been pursuing a case against Marumo Gallants, who had been accused of fielding an incorrectly registered player during the league campaign. After the PSL had initially refused to act, City approached the SAFA arbitration tribunal, who ruled in their favour and said the PSL had to deal with the matter. City wanted the stiffest sentence possible – a points deduction – to be given to Gallants. A points deduction would have seen the Bloemfontein-based club drop to the bottom of the league, which would have saved City from relegation. Get your news on the go, click here to join the IOL News WhatsApp channel. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ However, Gallants pleaded guilty and escaped with just a R200,000 fine. It marked yet another door slammed shut for City. Earlier, newly promoted Orbit College insisted they had big ambitions and were not entertaining selling their status. The same was said by Richards Bay, who turned down a massive offer of R72 million. 'I've got someone I won't mention by name who sent me a message saying there's a desperate club looking to buy into the top flight,' Richards Bay boss Sfiso Jomo Biyela said earlier last month, according to FARPost. 'They stated that they put up R60 million. They told me if I sign, the money can kick in just the next day. And they also put R12 million or R15 million – it'll be up to me if I take the status in the NFD. 'Think about it – it's R72 million. I asked them if they knew what a legacy meant. I said to them, legacy is priceless – there's no value you can table here. Try elsewhere.' Currently, TS Galaxy's financial woes could give City their last chance of staying up. TS Galaxy find themselves in a tight financial corner, which could force the Mpumalanga outfit to sell their status. Tim Sukazi's side, who finished fifth in the league last season, won't be able to strengthen their squad ahead of the new campaign due to a transfer ban. The punishment stems from an unpaid balance owed to Ivorian forward Bernard Yao Kouassi, who had signed in January 2023 but left by August without playing. FIFA ruled that TS Galaxy had breached his contract by failing to pay his dues, triggering a ban on registering new players for three consecutive transfer windows. On top of that, there's the case with Jegbay Morris Konneh – another Ivorian – who joined the club last July but left after six months without getting paid. Last week, a FIFA Dispute Resolution Chamber ruled that the club must pay around R319,000 for six months of salary, plus 5% interest from August 1, 2024. Additionally, they owe around R1.79 million in compensation for breach of contract, also with 5% interest from December 31, 2024. Failure to pay this within 45 days will result in another ban over three windows. If TS Galaxy fail to resolve their financial woes soon, they risk collapsing under the weight of mounting debts and administrative sanctions. Owner Tim Sukazi could well be tempted to sell the club, opening the door for John Comitis and Cape Town City's bid to stay in the top flight. For now, City's only hope lies in another club's misfortune – a harsh reminder of how brutal survival in South African football can be. IOL Sport Get your news on the go, click here to join the IOL News WhatsApp channel.
IOL News
18 hours ago
- IOL News
Impact of the latest interest rate cut on South Africa's economy
Following a unanimous decision by the Monetary Policy Committee, South Africa's interest rates have been cut to 7.0%. This article explores the implications of this decision, including the new focus on a 3.0% inflation target and its potential impact on the economy. Image: File The Monetary Policy Committee (MPC) cut rates by 25bps to 7.0% in a unanimous decision, as expected by both the market and analysts, says Matrix Fund Managers economist Kim Silberman. She says the room to cut rates was made available by inflation remaining well contained and, importantly, by 5-year inflation expectations falling to 4.4%. "This is the first time that long-term inflation expectations have fallen below the 4.5% midpoint of the target band since the BER survey began," she says. More important was the announcement that the South African Reserve Bank (SARB) will now focus on targeting 3.0% inflation, which is the bottom end of the existing range of 3.0% - 6.0%, she says. According to the MPC, this decision is procedurally equivalent to when the SARB announced in 2017 that it would explicitly target 4.5%. "The governor confirmed that, as yet, no agreement has been reached with the National Treasury on changing the inflation target. Consequently, while the target band is still officially in place, the Quarterly Projection Model (QPM) will now use 3.0% as its target, as opposed to 4.5%. "The sacrifice to growth is estimated to be minimal: GDP growth is lower by 20 basis points (bps) in 2026, having been revised from 1.5% to 1.3%. GDP is actually higher in 2027 by 20bps, revised to 2.0%," she says. Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Advertisement Video Player is loading. Play Video Play Unmute Current Time 0:00 / Duration -:- Loaded : 0% Stream Type LIVE Seek to live, currently behind live LIVE Remaining Time - 0:00 This is a modal window. Beginning of dialog window. Escape will cancel and close the window. Text Color White Black Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Background Color Black White Red Green Blue Yellow Magenta Cyan Transparency Opaque Semi-Transparent Transparent Window Color Black White Red Green Blue Yellow Magenta Cyan Transparency Transparent Semi-Transparent Opaque Font Size 50% 75% 100% 125% 150% 175% 200% 300% 400% Text Edge Style None Raised Depressed Uniform Dropshadow Font Family Proportional Sans-Serif Monospace Sans-Serif Proportional Serif Monospace Serif Casual Script Small Caps Reset restore all settings to the default values Done Close Modal Dialog End of dialog window. Next Stay Close ✕ The new QPM lowers the inflation forecast significantly to 3.1% in 2026 and 3.0% in 2027 from 4.2% and 4.4% in the May meeting. Their new forecasts are also below our in-house expectations of 3.8% in the second half of 2025 and 4.1% in 2026, Silberman says. "The SARB expects risks to their forecast to emanate primarily from developed markets. Uncertainty about US rates and inflation, the dollar, the oil price, and ever-changing tariff expectations make forecasts difficult. Higher tariffs could cause more disruption to the global economy," says Silberman. According to the SARB, lower inflation allows for lower interest rates due to the nature of the QPM. Targeting 4.5% results in the repo rate troughing at 7.0%, while targeting 3.0% takes rates 120bps lower, to 5.8% in 2027. Admittedly, they do have real rates temporarily higher in the 3% scenario. We think it will be difficult for the SARB to cut rates by an additional 120bps and simultaneously generate rand appreciation, which is what their model supposes, especially in a world where the Fed is likely to keep rates on hold for longer. "Additionally, from our reading of the post-MPC discussion, inflation is expected to fall to 3.0% purely as a result of changing the target, i.e., there have been no announced changes to the inflation model assumptions other than that the target has changed," Silberman says. She says the announcement raises questions around where the mandate for inflation targeting sits. "It was clarified by the governor that it sits in Section 224 of the constitution, which states that 'the SARB must protect the value of the currency in the interest of balanced and sustainable economic growth in the Republic. Furthermore, the SARB is mandated to perform its functions independently and impartially.' "This gives the SARB the mandate to do what it deems necessary to protect the exchange rate and ensure price stability. In this context, the governor highlighted that research shows that inflation at 3.0% maintains price stability," she says. Silberman says the SARB was careful to avoid stating that South Africa now has a point target of 3.0%, preferring to articulate that as of September 2025, there will be a change in focus from 4.5% to 3.0%, within the existing band. "In response to the MPC meeting, the yield on government bonds maturing in 2035 fell 20bps to 9.62%, while the rand remained relatively stable at around 18.00 to the US dollar. Interest rate derivatives have reduced by about 10bps, implying that market expectations of the repo rate over the remainder of 2025 are evenly balanced in favour of one more cut. Markets are starting to fully price in a 25bps cut in 12 months. The market may still be digesting the news, and it appears that rate expectations are not adjusting to the significant changes in QPM expectations," she says. Consult by Momentum CEO Johan Minnie says a rate cut offers some relief for consumers with debt – your home loan or car repayments may drop slightly, and that can free up some extra cash each month. "But instead of spending more or taking on new debt, now's the time to be smart: start by paying off high-cost debt like credit cards, revolving credit, or retail store accounts. "Once that's done, channel the savings into your home loan – it's one of the most tax-efficient ways to build wealth over time. You could also increase your retirement fund or RA contributions, which are tax-deductible and benefit from the power of compound interest," he says. Minnie says, alternatively, commit to additional discretionary savings for future goals like education or travel. "Whatever you do, resist the urge to increase your everyday spending or take on new instalments, as short-term satisfaction can erode long-term stability. This small rate drop may not feel dramatic, but used wisely, it can help you build more financial resilience," he says. Jawitz Properties CEO Herschel Jawitz says the 25-basis-point rate cut is going to continue supporting the slow recovery in the residential property market, both from an affordability and consumer confidence point of view. "The cumulative rate cut of 1.25% since the cycle started means that, on a one-million-rand home loan, monthly repayments have decreased by R840 per month," he says. Jawitz says homeowners who continue to pay the current payment of the extra R168 per month could reduce their loan period by up to a year and reduce their total repayments by nearly R100,000, depending on how many years they have left on their home loan. This may be a viable option for some homeowners. "This, in addition to reducing the cost of servicing other debt, such as car and credit card repayments. For a two-million-rand home loan, the monthly reduction in the repayment is R1,680. Cumulatively, over a year, these amounts will have an impact on disposable income for homeowners and buyers.
